Turkey’s inflation falls to 61.78 percent in July

Turkey’s annual rate of inflation slowed sharply in July to 61.78 percent as the country battles a cost-of-living crisis, Agence France-Presse reported on Monday, citing the Turkish Statistical Institute (TurkStat).

It is the second consecutive fall after consumer price rises eased to 71.6 percent in June.

“Annual inflation is falling,” Finance Minister Mehmet Şimsek said on the social media platform X.

“We continue to get positive results in all areas of our program, whose main objective is disinflation,” he said.

“The decrease in inflation will be felt more in the coming period.”

According to ENAG, an independent group of economists, annual inflation was much higher than was announced by TurkStat, standing at 100.88 percent in July. ENAG also said the increase in monthly inflation was 5.91 percent last month, contrary to the 3.23 percent announced by TurkStat.

ENAGrup Consumer Price Index (E-CPI) increased by 5.91% in July, 2024.

E-CPI increased by 100.88% in the last 12 months

— ENAG (@ENAGRUP) August 5, 2024

The central bank began to raise interest rates in efforts to battle inflation last year after President Recep Tayyip Erdoğan dropped his opposition to orthodox monetary policy.

The bank kept borrowing costs unchanged at 50 percent for a fourth consecutive month in July.

Inflation traditionally eases during the summer in Turkey as energy consumption falls and tourism brings in foreign currencies.

Education, housing, health, and hotel and restaurants saw the biggest price increases.

Erdoğan said last month, “We will all see the fever of inflation decrease in the coming months.”

The staggering rise of consumer prices and the steep decline in value of the Turkish lira are deemed responsible for the severe setback suffered by Erdoğan’s Justice and Development Party (AKP) in the March local elections.